Beyond Refining: Building Pakistan’s Energy Backbone

Usama Qureshi has built a career on turnarounds. At K-Electric, as Chief Marketing Officer and Chief of Staff, he was part of the leadership team behind the utility's turnaround, a story later taught at Harvard Business School and the Harvard Kennedy School. As Managing Director and CEO of Hamdard Laboratories Pakistan, he led the modernization of a Pakistani household name. He began his career at Pakistan State Oil, on the team that revived its fuel cards business.

Since joining Cnergyico in 2021, becoming Vice Chairman in 2022, he has brought the same instinct to a business operating at national scale. He shapes long-term strategy, strengthens governance and makes the Company's case to government, regulators and international partners. He also sits on the boards of the Company's subsidiaries. Twenty-five years across energy, FMCG, fintech and telecommunications give him an unusually wide lens. He is Chief Executive Officer of Amps & Volts (formerly Oasis Energy), an electrical switchgear and power solutions manufacturer. He is also Strategic Advisor to Kuickpay, a payments aggregation platform.

Beyond the boardroom, he is one of the sector's most visible voices, writing and speaking on Pakistan's energy future and economic policy. He serves on the Global Advisory Council of the Commonwealth Enterprise and Investment Council (CWEIC), which Cnergyico has joined as a Strategic Partner. He also champions Pakistan's trade and exports through the FPCCI and national business councils. He holds an MBA.

Followings are excerpts from an exclusive interview with Pakistan & Gulf Economist:

PAGE: Please tell us briefly about Cnergyico, from an oil refinery to an important component of Pakistan’s emerging energy infrastructure.

Usama Qureshi: Cnergyico’s journey has been one of continuous growth, integration and investment in Pakistan’s energy infrastructure. From our beginnings as a refining business, we have evolved into a vertically integrated energy company with operations spanning refining, petroleum marketing, storage, logistics and distribution.

Today, Cnergyico operates Pakistan’s largest oil refining complex by installed capacity, with a combined capacity of 156,000 barrels per day. Our infrastructure also includes the country’s first and only Single Buoy Mooring (SBM), substantial crude oil storage capacity and a nationwide network of more than 480 retail outlets under the byco brand.

This integrated model allows us to participate across the petroleum value chain, from importing crude oil and refining it into finished products to storing, distributing and marketing those products. As Pakistan’s energy requirements evolve, our objective is to strengthen energy security, diversify crude supply sources, improve product quality and progressively modernize our refining infrastructure.

PAGE: The company enjoys a few distinctions, including the largest refining capacity of 156,000 barrels per day. What has been the average capacity utilization and what is being done to improve it?

Qureshi: Our installed refining capacity is 156,000 barrels per day. Average utilization has been around 35%, or about 55,000 barrels per day. However, this must be viewed mainly in the context of local market demand, refining margins and the ability of the domestic market to absorb locally refined products. During the recent crisis, when imports were constrained and local demand was strong, Cnergyico increased throughput to more than 80,000 barrels per day.

The refinery is therefore not constrained by its technical nameplate capacity. Utilization is primarily driven by prevailing market and economic conditions. Our approach is to operate at levels that provide an optimal product yield and economic return rather than simply maximizing throughput irrespective of market conditions.

Going forward, we are working on several fronts to raise utilization on a sustainable basis: diversifying crude supply, securing better commercial terms, developing product exports through a second SBM and completing the refinery modernization program. Improved domestic demand and a more conducive refining environment will support this further.

PAGE: The company processes crude from different regions and has recently imported West African and American crude. How has the experience been?

Qureshi: One of Cnergyico’s key strengths is the flexibility of its refining configuration and associated infrastructure, which enables us to evaluate and process crude oil from diverse geographical sources.

Our processing of West African crudes demonstrated the refinery’s ability to handle crudes of different characteristics and complexity. Similarly, sourcing West Texas Intermediate (WTI) from the United States has broadened Pakistan’s crude supply options beyond its traditional dependence on Middle Eastern suppliers. Our crude procurement decisions are commercial and

technical in nature. We assess each crude on landed cost, freight, product yields, refinery compatibility, financing terms, reliability of supply and prevailing market conditions. The ability to source from multiple regions gives us greater flexibility and contributes to Pakistan’s broader objective of energy security.

The experience has reinforced our view that diversification is strategically valuable. Rather than depending on a limited number of supply sources, we can evaluate opportunities across the international market and select crude grades that offer the best combination of operational compatibility, economics and supply security. This flexibility has served both the refinery and the country well during periods of supply disruption.

PAGE: Another unique feature is the Single Buoy Mooring (SBM) facility. How has this contributed to achieving higher synergy?

Qureshi: The SBM is one of Cnergyico’s most important strategic assets and provides a significant logistical advantage. It enables crude oil and petroleum products to be received offshore and transferred through dedicated pipelines directly to our storage and refining facilities.

The SBM can receive fully laden Suezmax and Aframax vessels, which cannot berth fully laden at Karachi Port or Port Qasim. It is connected to our onshore facilities through approximately 11.5 kilometres of subsea and 3.3 kilometres of onshore pipeline. This creates several synergies. It reduces dependence on conventional port infrastructure, enables the handling of larger crude cargoes, supports economies of scale, lowers logistics complexity and connects crude imports directly with our storage and refining complex.

The SBM was particularly useful in receiving our WTI and West African crude cargoes. On these longer voyages, the ability to bring in larger cargoes helps lower the freight cost per barrel. From a national perspective, this infrastructure also contributes to energy security and reduces pressure on conventional port facilities.

PAGE: Cnergyico owns and operates retail outlets and also supplies products to other OMCs. How does this help in achieving higher standards of finished products?

Qureshi: Our vertically integrated model provides an important advantage because we remain connected with the product throughout much of the value chain, from crude selection and refining to storage and ultimately the retail customer.

Cnergyico operates a nationwide network of more than 480 Byco outlets while also supplying petroleum products to other oil marketing companies and organizations. This gives us direct exposure to market requirements and customer expectations.

Quality control is maintained through established specifications and testing procedures at the refinery and across the supply chain. Having refining and marketing within the same business also provides valuable feedback on product performance, demand patterns and changing customer requirements. As we proceed with refinery modernization, this integration will become even more valuable. Our objective is to produce cleaner, higher-value fuels meeting Euro-V specifications while ensuring that quality is maintained throughout storage, transportation and delivery.

PAGE: Some analysts believe Cnergyico’s location is a bottleneck because transportation by bowsers is expensive and problematic during the monsoon season. How has the experience been?

Qureshi: Every industrial location presents a combination of logistical advantages and challenges. Our location at Hub provides a major strategic advantage because of its proximity to the coast and direct integration with our SBM, storage infrastructure and refining complex.

We recognize that inland movement of finished products by road tankers involves transportation costs and can face temporary disruption during extreme weather or poor road conditions. These challenges are not unique to Cnergyico and form part of the broader logistics environment in Pakistan. Our integrated storage and distribution network, inventory planning and supply chain management help mitigate these risks. Importantly, any assessment of our location must also take into account the advantages of direct offshore crude handling through the SBM, access to large cargoes and extensive on-site storage.

We continue to optimize our logistics footprint so that products reach different markets efficiently and reliably while maintaining the required safety and product quality standards.

PAGE: How does the proposed modernization program help in improving the quality of products?

The refinery modernization program is fundamental to Cnergyico’s long-term strategy. We have initiated work on a refinery upgrade project involving an investment of more than US$1 billion.

In September we signed the upgrade agreement with the Government under the refining policy. The project is designed to materially change our product slate. It will increase production of higher-value products, particularly High-Speed Diesel and Motor Gasoline, while significantly reducing production of Furnace Oil. Most importantly from a product quality perspective, the upgraded configuration will enable our products to meet Euro-V specifications, which means cleaner fuels with substantially improved environmental characteristics.

The upgrade will deliver benefits on several fronts: better product quality, a higher proportion of valuable transportation fuels, lower furnace oil output, improved refinery economics and a reduced environmental footprint. It also aligns Cnergyico with Pakistan’s broader objective of modernizing its refining sector and reducing dependence on imported finished products.

We are also planning a second SBM for product exports. This will improve refinery utilization, reduce our dependence on the local market alone and generate much-needed foreign exchange for the country.

PAGE: How did Cnergyico respond to the recent disruption in Gulf oil supplies and what role did it play in keeping the country supplied?

The disruption in the Strait of Hormuz earlier this year was one of the most serious energy security tests Pakistan has faced. Before the conflict, around 90 percent of the country’s oil and LNG imports passed through Hormuz. When imported finished products became difficult to secure, domestic refining became the country’s first line of supply. Cnergyico responded on three fronts.

First, we raised refinery throughput to more than 80,000 barrels per day to meet local demand at a time when imported products were scarce.

Second, because our crude sourcing was already diversified, we continued processing crude from outside the Gulf, including WTI from the United States and grades from West Africa. Over nine months we imported around 8.1 million barrels of US crude.

Third, our SBM allowed these large cargoes to be received directly at Hub without adding to congestion at Karachi’s ports, while our storage capacity and Byco network kept products moving to customers across the country.

The crisis showed in practical terms why domestic refining capacity, diverse crude sources and independent offshore import infrastructure matter for national energy security. It has also strengthened the case for our refinery upgrade and a second SBM, which will add further resilience.

PAGE: Cnergyico has returned to profitability after a difficult period. What drove this turnaround?

Qureshi: The last few years were challenging for the entire refining sector. High finance costs, limited working capital, weak local demand and competition from smuggled products all weighed on refinery economics. The company recorded a loss in FY2025.

FY2026 marked a clear turnaround. For the year ended June 30, 2026, Cnergyico reported a profit after tax of PKR10.75 billion compared with a loss of PKR2.90 billion the previous year. Sales rose to PKR410.2 billion from PKR296.7 billion and earnings per share were PKR1.96 against a loss per share of PKR0.53.

Several factors contributed. We diversified our crude sourcing and became the first refinery in Pakistan to process US crude, which improved product yields and operational flexibility.

We operated with tighter cost discipline and expanded product exports, earning foreign exchange for the country. Stronger refining margins during the crisis helped, but the groundwork for the recovery had been laid well before it.

Our focus now is to make this recovery sustainable through the upgrade program, higher utilization and a stronger export business.

PAGE: Cnergyico’s refinery is located away from the city in Balochistan. How does the company engage with the communities around it?

Qureshi: For us, CSR is not a set of one-off events. Our refinery has been part of this community for more than three decades and its progress is tied to ours. Our approach rests on three principles. We focus on the five villages closest to our operations. We work through established partners who bring expertise and accountability. We sustain our programs year after year so that communities can rely on them.

Education, with a focus on women:

Through our partnership with The Citizens Foundation (TCF), we support government primary schools in the area and provide transport so that children can reach school safely. We sponsor female teachers at a girl’s school in Gaddani and support young women from Mouza Kund training as midwives. Investing in women teachers and midwives builds skills that stay within the community.

Health and clean water:

Access to healthcare is limited in the area, so we run an ambulance service that connects the surrounding villages to hospitals in Hub and Karachi. We have also provided equipment to LRBT’s Secondary Eye Hospital in Quetta, extending our support for eye care across the province.

Clean drinking water is scarce in this part of coastal Balochistan. Our seven solar-powered reverse osmosis (RO) plants supply safe drinking water to five villages using renewable energy.

Livelihoods and dignity:

With Akhuwat, we support interest-free microfinance that helps families in Hub build their livelihoods. With Bioniks Welfare Organization, we provide prosthetic limbs to people who could not otherwise afford them, helping them return to work and daily life.

The refinery itself supports more than 3,000 direct and indirect jobs in the area, which remains our largest contribution to the local economy.

Environment:

Responsible operations are the foundation of our environmental commitment. A coral reef has developed along our subsea pipeline between the SBM and the refinery, a rare marine habitat in Pakistani waters that we continue to support. We have also planted trees around our refining complex.

Our biggest environmental contribution, however, will come from the refinery upgrade, which will produce Euro-V fuels with substantially lower sulphur content.

As the upgrade progresses, our footprint in the region will grow through more jobs, local procurement and cleaner fuels. We intend our community programs to grow alongside it.

The Shifting Paradigm of Pakistan’s Energy Sector

The prolonged disruption in the Strait of Hormuz has exposed a structural vulnerability in Pakistan’s energy supply chain: heavy dependence on imported crude oil and petroleum products moving through a strategically sensitive maritime corridor. What initially appeared to be a geopolitical challenge is now compelling Pakistan to rethink the architecture of its energy sector.

The incumbent government is reportedly engaging with oil-producing Arab countries to explore the establishment of crude oil and finished petroleum product storage facilities in Pakistan. If translated into concrete investments, this initiative could mark an important shift from Pakistan’s traditional model of importing petroleum largely on a shipment-to-shipment basis toward a more resilient system built around strategic storage, refining capacity and integrated logistics.

Pakistan has already announced plans to modernize its existing oil refineries. At the same time, proposals are being pursued for the establishment of a new greenfield or brownfield refinery. These initiatives should not be viewed as isolated projects. Together with additional storage capacity, they could trigger a broader transformation of the country’s downstream oil industry.

For decades, Pakistan’s refinery sector has struggled with ageing plants, technological limitations, inadequate investment and an unfavorable product mix. The modernization program provides an opportunity to address these weaknesses. Upgraded refineries could improve their ability to process different grades of crude, enhance yields of higher-value petroleum products and reduce dependence on imported finished products.

A new refinery, meanwhile, could complement rather than compete with existing capacity if planned according to future domestic demand and regional market requirements. The key is to avoid simply adding capacity without addressing efficiency, product quality, logistics and commercial viability. Pakistan needs refineries designed for the energy market of the future, not merely larger versions of yesterday’s facilities.

The proposed storage infrastructure could be equally significant. Pakistan has historically operated with limited strategic petroleum storage compared with the requirements of an economy dependent on imported energy. Adequate stocks of crude oil and finished products would provide greater flexibility during international supply disruptions, shipping constraints or sudden price volatility.

For Arab oil-producing countries, establishing storage facilities in Pakistan could also have commercial and strategic value. Storage closer to South Asian markets can potentially shorten supply chains, improve inventory management and facilitate timely deliveries. Pakistan, because of its geographic position, could emerge as a useful link between Middle Eastern producers and consumers in South Asia.

This development could consequently change the business model of oil marketing companies (OMCs). Instead of relying predominantly on imported finished products and conventional distribution networks, OMCs could increasingly operate within an integrated ecosystem involving local refining, bulk storage, transportation and inventory management. Competition may gradually shift from access to imported products toward efficiency, logistics, supply reliability and customer reach.

The logistics sector would also be affected. Expansion of storage facilities would require investment in ports, pipelines, tank farms, road and rail transportation, safety systems and digital inventory management. Such investment could create a wider energy-services ecosystem and generate opportunities beyond the petroleum sector itself.

However, infrastructure alone will not deliver a paradigm shift. Pakistan must ensure transparent regulations, commercially viable tariffs, efficient ports, reliable pipelines and a predictable taxation regime. Investment decisions extending over decades require policy continuity. Frequent changes in duties, pricing mechanisms and regulatory requirements can discourage precisely the long-term capital that the sector needs.

The government should therefore treat refinery modernization, new refining capacity and strategic storage as components of a single downstream energy strategy. Coordination among refineries, OMCs, ports, pipeline operators, financial institutions and regulators will be essential.

The Strait of Hormuz crisis has demonstrated that energy security cannot depend solely on uninterrupted international shipping. Pakistan needs buffers within its own territory. Strategic storage, diversified supply arrangements, modern refineries and efficient logistics can collectively provide those buffers.

The emerging opportunity is therefore larger than the construction of a few refineries or storage tanks. It is about shifting Pakistan’s energy paradigm—from a predominantly import-dependent distribution model toward an integrated system combining refining, storage, logistics and strategic inventory management.

If implemented with commercial discipline and long-term policy consistency, the present challenge could become a catalyst for transforming Pakistan’s downstream petroleum industry. The objective should not merely be to survive the next disruption, but to build an energy infrastructure capable of absorbing future shocks while supporting industrial growth and national economic security.

Will Joe Biden succeed in reining in oil prices?

The United States is pulling out various stops in an effort to get gas prices under control at the start of a busy holiday travel season. The administration is tapping into the strategic petroleum reserve and President Biden has called on the Federal Trade Commission to investigate whether oil companies are responsible for increased prices.

But the focus on gas prices has provided fuel for Republican attacks on Biden’s handling of the economy, and his energy policies in particular, at a time when the White House is hoping to rally support for ambitious climate goals in its roughly US$2 trillion spending plan.

There was a prediction that 53.4 million people will travel for the Thanksgiving holiday, a 13% increase from 2020 when many Americans opted not to travel with coronavirus cases and deaths surging around the country.

The busy travel season to come has put a spotlight on gas prices in particular amid broader concerns about inflation, something the White House has attempted to show it has under control.

“Obviously, the president does not control the price of gasoline -- no president does,” Energy Secretary Jennifer Granholm told reporters. “But what we’re seeing right now is this global mismatch between supply and demand. Oil production is lagging behind as the rest of the economy roars back to life after the shutdown.”

“So, we, in this administration, are leaving no stone unturned as we examine the market to figure out what's behind the high prices,” she said.

The White House has shown more urgency in recent weeks in publicly messaging how it is trying to provide relief for Americans grappling with inflation, particularly after the Labor Department released statistics showing consumer prices grew far faster than expected in October and that annual inflation had hit a 30-year high. That rise was in part a result of rising energy costs, and increased costs at the gas pump.

Biden last week wrote to the Federal Trade Commission requesting the agency look into whether oil companies were unfairly spiking prices at the pump.

And on Tuesday, the administration announced it would release 50 million barrels of oil from the nation’s Strategic Petroleum Reserve in coordination with several other countries in an effort to match supply with demand.

Experts have questioned whether either move will do much to meaningfully bring down prices immediately, and they cautioned other factors, like the course of the pandemic, are more likely to affect the trajectory in the months to come.

That has led some conservatives to question whether the White House’s actions on gas prices were more of a political maneuver as poll after poll has shown voters souring on Biden, particularly over his handling of the economy, with his approval ratings dropping into the low 40s.

“This is being done in order to use every tool at the president's disposal to lower the price of gas for the American people,” White House press secretary Jen Psaki said when asked if tapping into the strategic reserve was being done for political purposes.

Republicans have gone on offense over inflation for the last few weeks, and the Biden administration’s decision to release oil from the strategic reserve provided more fodder for attacks on its energy policies.

Former President Donald Trump and GOP lawmakers argued the Biden administration’s desire to shift away from fossil fuels and toward clean energy industries has led to problems at the pump.

“Today’s announcement is nothing more than a gesture. If the president and his administration wanted to make a real, long-term impact, they would work to maximize domestic production and expedite energy infrastructure like pipelines—not close federal lands to drilling and add a federal tax to methane,” Sen. Shelley Moore Capito, ranking member on the Senate Environment and Public Works Committee, said in a statement.

Sen. John Barrasso, the top Republican on the Senate Energy and Natural Resources Committee, accused Democrats of “waging a war on American energy.

Even Sen. Joe Manchin, who has opposed some climate initiatives in Biden’s Build Back Better agenda, called the release of oil from the reserves an “important policy Band-Aid for rising gas prices” while criticizing the administration's energy policy as “shortsighted.”

Biden in remarks Tuesday sought to assure the public that the US economy was on the upswing and a rise in prices would not be a long-term concern.

“I also want to briefly address one myth about inflated gas prices: They are not due to environmental measures. My effort to combat climate change is not raising the price of gas or increasing its availability,” Biden said in prepared remarks, arguing investments in electric vehicles, solar panels and other sectors would spur job creation and innovation.

“Let’s beat climate change with more extensive innovation and opportunities,” he added. “We can make our economy and consumers less vulnerable to these sorts of price spikes when we do that.”